(The Center Square) – Legislative compromises on an impending minimum wage increase and sick leave changes were signed into law on Friday by Michigan Gov. Gretchen Whitmer.
This came after Michigan’s Republican-led House of Representatives and the Democrat-led Senate approved the legislation on Thursday night, just hours before changes were set to go into effect.
“Michigan workers deserve fair wages and benefits so they can pay the bills and take care of their family, and small businesses need our support to keep creating good jobs in Michigan,” said Whitmer. “I’m proud to sign these two bipartisan bills into law that will raise wages, ensure workers can take time off to care for themselves or their loved ones, and continue growing our economy.”
The controversy over the policies first began in 2024, when Republicans and Democrats failed to compromise in the final days of the lame duck session.
In January, Republicans took control of the state House, eventually garnering even Democratic support for adjusting the legislation. Both parties then proposed versions of the bills to mitigate changes, maturing into the compromise signed by Whitmer.
While neither party was totally happy with the compromise, Republicans still celebrated the changes that were made.
“House Republicans led the charge to restore the tipped wage for restaurant workers and fix the sick time law for our workers and small businesses,” said Rep. Bill G. Schuette, R-Midland, who chaired the House Select Committee on Protecting Michigan Employees and Small Businesses. “After months of inaction last term, it was time for the Legislature to come together and listen to those who were going to be impacted.”
Senate Bill 8 was the compromise on the minimum wage and tipped wage policies.
If the older version had gone into effect on Friday, it would have eventually eliminated “tip credit” jobs, which allows employees to be hired for less than minimum wage, but still earn tips.
The current plan raises the state minimum wage to $15 by 2027, starting by a raise on Friday from $10.56 to $12.48, but would no longer see a total phase out of those tip credit jobs.
Instead, it maintains the tip credit at 38% throughout 2025, while adding annual increases by 2%, eventually capped at 50% of the minimum wage in 2031.
Sen. Kevin Hertel, D-St. Clair Shores, sponsored the Senate bill.
“I’m thankful for my colleagues on both sides of the aisle who stepped up, put politics aside, and worked in good faith to reach a compromise on this important issue,” he said. “While there is no perfect solution that would satisfy all parties involved, we were able to deliver a fair, bipartisan agreement that not only protects but improves the tipped wage to ensure workers get a meaningful raise, while employers are able to continue running their businesses.”
House Bill 4002 adjusted the sick leave policies. Under the older version, the expansion of sick leave policy would have applied to all employees, including seasonal, part-time or temporary employees. The new version still increases flexibility for sick leave, while providing protections for businesses from “no-call, no-show” absences.
“We had two options: let bad policies take effect and watch small businesses get carried to hell in a handbasket, or step in with a plan that gives them a fighting chance,” said Rep. William Bruck, R-Erie. “This deal isn’t ideal, but it keeps businesses afloat and protects the livelihoods of hardworking people, small business owners and their employees.”
